Aggressive Code Enforcement Not Intended to Shut Down Site

July 26, 2009

Facts: In March 2002, AHF Community Development, LLC, a nonprofit affordable housing provider, acquired the Bent Creek Apartments in the Lake Highlands area of Dallas with funds from a bond issuance by the Texas State Affordable Housing Corporation. AHF claimed in court that the City of Dallas violated the Fair Housing Act by devising a plan to shut down Bent Creek. AHF said the city made up building code violations to drive away residents and intimidate managers. The decline in occupancy at Bent Creek caused AHF to default on its bond indebtedness.

Facts: In March 2002, AHF Community Development, LLC, a nonprofit affordable housing provider, acquired the Bent Creek Apartments in the Lake Highlands area of Dallas with funds from a bond issuance by the Texas State Affordable Housing Corporation. AHF claimed in court that the City of Dallas violated the Fair Housing Act by devising a plan to shut down Bent Creek. AHF said the city made up building code violations to drive away residents and intimidate managers. The decline in occupancy at Bent Creek caused AHF to default on its bond indebtedness. AHF charged that racial hostility toward the residents of Bent Creek, who were largely African American and Hispanic, was behind the city's actions.

In the city's S.A.F.E. Program, officers from the Dallas Police Department and building code and fire code inspectors work with owners to reduce crime at their properties and to rehabilitate or remove properties that have become havens for criminal activity. AHF and Bent Creek site managers cooperated voluntarily with the SAFE Team in 2004 and 2005 to improve site safety, but the crime there persisted.

On March 13, 2006, accompanied by police, building inspectors with the SAFE Team inspected all 318 units at the Bent Creek site. Over 60 percent of the units inspected that day failed the inspection. Inspectors also cited common areas for violations. AHF described the SAFE Team's March 13 operation as a high-visibility raid to search for evidence of criminal activity, to harass and intimidate Bent Creek residents and managers, and to manufacture a list of frivolous code violations. According to AHF, all of these actions would help the city in a court case to condemn and demolish the Bent Creek site. AHF alleges that the SAFE Team's activities had their desired effect: They caused occupancy at Bent Creek to fall from around 85 percent to around 50 percent and pushed the site into default.

Decision: The U.S. District Court for the Northern District of Texas rejected AHF's claims and threw out the case.

Reasoning: While AHF pointed to a one-time “raid” at Bent Creek, it did not establish to the court's satisfaction that this event was part of a pattern of harassing behavior by the city designed to deprive residents of their rights. The court said that even if the city had devised a plan to destroy multifamily housing in Lake Highlands, it had never acted on it. The city had not tried to condemn, close, or demolish any units or to make them unavailable unfairly. Code enforcement inspections like the ones at Bent Creek are intended to improve the quality of life of residents by ensuring that the property meets minimum health and safety standards. The purpose of the SAFE Team's inspections was to assure habitability, not to drive away residents, deny them access to housing, or shut down the site.

  • AHF Community Development, LLC v. City of Dallas, June 2009

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